The Attorney General of Massachusetts yesterday announced an $8.75 million settlement and enforcement action with Rent-A-Center over allegations related to how it collected debts from its customers.
The Who: Rent-A-Center is among the nation’s largest rent-to-own retailers, operating more than 40 locations in Massachusetts, many of which are in predominantly low-income communities and communities of color.
The What: Rent-A-Center was accused of using the criminal process, or the threat of arrest and prosecution, as a debt collection tool. The company filed 951 criminal complaints, accusing customers of stealing leased or rented property when they failed to make payments or return rented items.
- The AG’s office also accused the company of violating state law with respect to how often it attempted to communicate with customers and limits on the number of conversations it could have during a seven-day period.
- When that didn’t work, the company made visits to customers’ homes, pounding on doors, turning doorknobs to see if they were unlocked, and demanding to be let in, according to the Assurance of Discontinuance.
The Penalty: Rent-A-Center will pay $8.75 million to the state.
- It will also cease filing criminal complaints when customers stop making payments on rented items and not make any reports to local police departments that either contains false information or is intended to be frivolous or harassing of a Massachusetts customer.
- For the next five years, any text message sent by the company to a customer has to be approved by the AG’s office first.
- For the next three years, the company will take a sampling of 20% of incoming calls from Massachusetts customers and make the recordings available to the AG’s office.
